Study on the Legal Effect of Contract Termination Lawsuit When No Substantive Judgment Is Obtained

DOI: https://doi.org/10.62517/jel.202514406

Author(s)

Mengmeng Qin

Affiliation(s)

China Jiliang University, Hangzhou, Zhejiang, China

Abstract

When a party directly seeks contract termination without prior notice, and the litigation fails to obtain substantive judgment due to withdrawal, dismissal, or amended claims, the divergence in applying Article 565 of the Civil Code and Article 54 of the Supreme People's Court's Interpretation on Several Issues Concerning the Application of the Contract Chapter of the Civil Code leads to legal ambiguities such as inconsistent determination of termination timing and suspended validity status. By analyzing the declaratory nature of contract termination actions, clarifying that service of a copy of the complaint constitutes valid notice for exercising termination rights, and recognizing that termination effects automatically occur under Article 565(1) of the Civil Code without requiring court judgment, this study proposes a "new coexistence theory." The theory maintains that withdrawal or dismissal generally does not affect termination effectiveness achieved at service, while amending claims to demand continued performance may be interpreted as implied withdrawal of termination intent. Ultimately, it introduces the "notification substitution + procedural equity" rule to resolve judicial discrepancies, unify standards for determining termination effects, and balance protection of termination rights with transactional stability.

Keywords

Right of Contract Termination; Formative Right; Action of Confirmation; New Coexistence Theory

References

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